Introduction

In finance, a warrant is a security that entitles the holder to buy or sell stock, typically the stock of the issuing company, at a fixed price called the exercise price.

It's similar to an option in that it derivative of an underlying and entitles a holder a right but not an obligation to the asset by an expiration date.

Conclusion

Warrants offer investors a way to participate in the potential upside of a company’s stock with limited initial investment. However, they also carry risks, including expiration and potential loss of value if the underlying stock does not perform as expected. Understanding how warrants work can help traders and investors make informed decisions about their portfolios.